Audit, Compliance and Risk Blog

Jon Elliott

Recent Posts

EPA Decides to Revise 2022-2025 Automobile GHG Emission Standards

Posted by Jon Elliott on Tue, May 22, 2018

On April 2, the US Environmental Protection Agency (EPA) announced that it has completed its “midterm evaluation” of greenhouse gas (GHG) emissions standards for cars and light trucks for model years 2022-2025, has decided to withdraw standards agreed to between the Obama Administration and California during 2016, and will conduct additional rulemaking to consider less stringent standards. This review began in March 2017, soon after President Trump appointed Scott Pruitt as EPA administrator with a mandate to reduce regulation. California, which has special authority under the federal Clean Air Act (CAA), is leading a coalition of states that has already sued to stop the change. In response to this push-back, President Trump has ordered federal agencies to negotiate with California to seek a compromise.

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Tags: Environmental risks, Environmental, EPA, Greenhouse Gas, ghg

Are Your Climate Risks “Material”, and If So, Do You Disclose Them?

Posted by Jon Elliott on Thu, May 17, 2018

The Securities and Exchange Commission (SEC) administers reporting requirements for companies listed on national securities exchanges (“listed companies” or “public companies”), under the federal securities laws, including the Securities Act of 1933 and the Securities Exchange Act of 1934. These requirements include detailed specifications for some reporting, such as financial reporting consistent with Generally Accepted Accounting Practices (GAAP). But SEC also administers vaguer reporting standards – including requirements to report any information that might be “material” to investors’ evaluation of a public company. Registered entities must disclose material information, including details or caveats necessary to ensure that the disclosures are not misleading. Materiality is open to wide differences in interpretation, at any given time across companies with different activities and resources, and over time based on developments in markets and the wider world. The Government Accountability Office (GAO) recently issued an evaluation of SEC’s “Commission Guidance Regarding Disclosure Related to Climate Change” (referred to below as the “2010 Guidance”), and subsequent general and company-specific guidance related to this topic. Read More

Tags: Corporate Governance, Business & Legal, SEC, directors, directors & officers

California Adds Ergonomics Standard for Hotel Workers

Posted by Jon Elliott on Tue, May 08, 2018

There are no national ergonomics requirements for employers, but California has just expanded its longstanding requirements, to add specific protections for hotel housekeepers. These new requirements complete review and rulemaking triggered in 2012 by a petition by a labor advocacy group, and are consistent with other requirements already administered by the state Division of Occupational Safety and Health (CalOSHA). The state’s efforts are also consistent with general guidance provided US Occupational Safety and Health Administration (OSHA). (OSHA has enforced its General Duty Clause against employers found to have ignored known hazards to their employees, since President Bush signed legislation in 2001 repealing OSHA’s own national ergonomics standard.).

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Tags: Employer Best Practices, Health & Safety, OSHA, Employee Rights

EPA’s Data Transparency Proposal – Secrets are in the Eye of the Beholder

Posted by Jon Elliott on Thu, May 03, 2018

On April 30, the US Environmental Protection Agency (EPA) published a proposed rule (40 CFR part 30) to “strengthen transparency in regulatory science” by requiring the agency to make the data and models used for significant regulatory decisions available for public and peer review. Like most things regarding EPA these days, the proposal has generated significant controversy – based to a large extent to whether the commenter puts more trust in the proposed system and today’s EPA, or in the existing system and yesterday’s EPA. In the remainder of this blog I’ll discuss what’s nominally involved, and possible adjustments to narrow the opportunities for manipulation by tomorrow’s EPA.

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Tags: Environmental risks, Environmental, EPA

Universal Wastes - EPA Proposes to Add Aerosol Cans

Posted by Jon Elliott on Tue, May 01, 2018

The Resource Conservation and Recovery Act (RCRA) assigns the US Environmental Protection Agency (EPA) to define and then regulate “hazardous wastes.” RCRA provides EPA considerable discretion, and one way the agency applies that discretion is by separating hazardous wastes into a variety of categories that are subject to distinct waste management requirements. One basis for these categorizations is relative risk – the more hazardous the waste the greater the controls required, and the smaller the threshold quantities necessary to trigger regulation. Beginning in 1995, EPA has defined a limited set of lower-risk wastes as “universal wastes” subject to special rules intended to encourage recycling (40 CFR part 273). In March 2018, EPA proposed to add aerosol cans. The rest of this note summarizes universal waste requirements, and how EPA is proposing to apply them to aerosol cans.

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Tags: Environmental risks, Environmental, EPA, Hazcom

Should You Have AEDs In Your Workplace?

Posted by Jon Elliott on Thu, Apr 26, 2018

Automated External Defibrillators (AEDs) are appearing in more and more public spaces and workplaces. These electronic devices are designed to deliver an electric shock to a victim of sudden cardiac arrest, and could save thousands of lives every year:

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Tags: Employer Best Practices, Health & Safety, OSHA, Employee Rights, AED

Does Sex Discrimination Include Sexual Orientation – The Second Circuit Changes Sides

Posted by Jon Elliott on Tue, Apr 24, 2018

Because federal anti-discrimination statutes include “sex” discrimination but do not define the term, its interpretation evolves with social and political changes, with policy changes by the Equal Employment Opportunity Commission (EEOC), which administers and enforces Title VII of the Civil Rights Act of 1964 and a variety of subsequent laws, and with court decisions. A major present debate is whether “sex” encompasses “sexual orientation” – which would protect non-heterosexual employees against employment action based on their sexual orientation. On February 26, 2018 the Second Circuit Court of Appeals reversed its own precedent, and decided that homosexual employees are protected.

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Tags: Employer Best Practices, Employee Rights, Workplace violence, EEOC, directors, directors & officers

Ninth Circuit: Salary History Doesn’t Justify Male-Female Pay Disparities

Posted by Jon Elliott on Tue, Apr 17, 2018

On April 9, a majority of the Ninth Circuit Court of Appeals ruled that an employer cannot rely on newly-hired employees’ salary histories to justify paying men more than women for the same work. Although the federal Equal Pay Act of 1963 allows disparities based on factors “other than sex,” the court found that salary histories are sufficiently tainted with sex discrimination to bar such reliance. Since it’s taken over 50 years for an appeals court to reach this conclusion, it’s worth exploring the court’s reasoning.

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Tags: Employer Best Practices, Employee Rights, directors, directors & officers

SEC Expands Public Company Cybersecurity Disclosure Expectations

Posted by Jon Elliott on Tue, Apr 10, 2018

The Securities and Exchange Commission (SEC) has just published Interpretive Guidance to “assist” public companies with evaluation and reporting of their cybersecurity risks. This Guidance expands similar SEC guidance issued in 2011, reflecting the growing importance of the issue and highly-publicized cybersecurity breaches during the intervening years. The following discussion summarizes the new Guidance, and provides context.

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Tags: Corporate Governance, Business & Legal, SEC, Internet, directors, directors & officers

Administration Proposes Massive Cuts in EPA for Fiscal Year 2019

Posted by Jon Elliott on Tue, Mar 27, 2018

On February 12, the Trump Administration issued its budget proposal for federal Fiscal Year (FY) 2019 (October 1, 2018 through September 30, 2019), subtitled “An American Budget”. The proposal included a 34% cut in the Environmental Protection Agency (EPA) budget, from $8.2 billion in FY 2016 (stable in FY 2017 and FY 2018 under a Continuing Budget Resolutions rather than a fully-new federal budget), to $5.4 billion for FY 2019, with corresponding personnel cuts from 15,408 full-time-equivalent employees (FTE) to 12,250. (these are numbers for EPA in the government-wide budget from the Office of Management and Budget (OMB); the stand-alone budget document on EPA’s website cites $6.1 billion).

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Tags: Business & Legal, Environmental risks, Environmental, EPA, climate change